Today is all about the fed decision at 2 pm est. Will the fed hike? Will they pause to save these regional banks? We will find out. My inkling is if they pause to appease the lawmakers and save the regional banks struggling that the market would not like it because it would signal some serious problems. I think they hike another 25 bps, but really it is all about the dot plot and what they see ahead. Everyone is keen to believe we’re going to be cutting rates soon, I am not in that camp, and any signal that we are, the market may like short term, but longer term it would probably signal that the fed isn’t serious about a return to 2% inflation which is their mandate. I have always been in the camp that at some point the fed will slowly lift their inflation target to possibly 3%, but we haven’t even begun to cross that bridge yet.
For the time being bulls do not want to see the SPY lose that white trendline below. Today is an inside day consolidating within yesterday’s big move down. The market is pricing in around a 1% move today. You can see a small bearish divergence forming on the MACD below with the market green today. Keep an eye on that, 4200 has been a stiff resistance for the SPX to breakthrough. It’s going to take alot to get through it.
Today’s Unusual Options Activity & What Stood Out
105 Trades Today
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